From 2008 through 2022, the 10-year Treasury yield was never above 3.25%; it spent nearly all of 2019–21 under 2%, while the 30-year bottomed at ~1% in March 2020.
What an amazing opportunity to refinance debt at ultra-low rates!
But not every institutional debtor is that savvy. Torsten Slok reminds us how much savvier Corporate America was than the US Government, including Congress, the Treasury Department, and even many “think” tanks.
As Slok observes:
“Corporate net interest payments have fallen to 0.4% of GDP because firms locked in record-low fixed rates during the pandemic. The US government did not extend the maturity of its debt outstanding when interest rates were close to zero and now pays 3.6% of GDP in net interest (chart below).”
This has been one of my biggest pet peeves for the past few decades.
When presented with a once-in-a-generation opportunity, there was an array of truly ignorant, foolish, or just outright false reasons not to make the carrying costs of long-term debt much cheaper. Treasury nominally lengthened the term of its debt, post-GFC and post-COVID. But it ignored the opportunity to issue 30-, 50-, or 100-year debt. That kind of long-term fixed-rate funding at historic lows only comes along once or twice in a generation.
Treasury did make some minor extensions of duration: The weighted average maturity (WAM) went from ~48 months in 2008 to ~64 months in 2012; by 2019, it was ~70 months — the longest duration since 2001. But issuing truly long-term debt, such as the 30-year or, heaven forbid, the 50/100 year — was off the table.
Why?
Some of the excuses were laughable then, but these three are downright silly now:
– “We do not time the market”
(Geithner, Yellen, Ramanathan, GAO, Office of Debt Management)– “There isn’t enough demand”
(Mnuchin, Yellen, Lew, Treasury Borrowing Advisory Committee)– “Rates will stay low”
(Summers, Blanchard, Furman and Mnuchin)
It was apparent then to anyone who looked closely; today, it’s an utterly obvious missed opportunity.
Again, this is not hindsight bias. As the list below, starting in 2013, shows, this was an obvious opportunity –one that was blown by all the usual fools.
Refinancing America’s Debt:
Fix infrastructure on the cheap while you still can (July 12, 2013)
Do We Need a 50-Year Bond? (May 12, 2014)
The Bonds That Can Cure America’s Ills (March 19, 2015)
Time for a 50-Year U.S. Treasury Bond (May 19, 2016)
Cost of Financing US Deficits Falls (December 18, 2020)
The Greatest Missed Opportunity of Our Lifetimes (October 23, 2023)
A Historic Missed Opportunity (June 3, 2025)
What’s Upsetting the Bond Market? (August 25, 2026)
Sources:
A Missed Opportunity: The Treasury Did Not Term Out Its Debt When Interest Rates Were Near Zero
Torsten Slok
Apollo, September 07, 2026
The Federal Government’s Debt Is Growing Faster Than the Economy. What Does that Mean for You?
GAO, June 11, 2026.
